The 10 Commandments of IP Dispute Resolution
Why have I opted to tackle this topic at all? It’s nothing to do with religion. It’s partly because, in the same way as carefully-articulated reasoning has been replaced by the sound-bite, a sound logical framework for guiding one’s actions has been replaced by the numbered list. Anyone spending time on Twitter or reading Forbes magazine will be aware of them: "7 fatal flaws when protecting your IP"; "5 things to ask your investment manager"; "8 things you must include in your business plan"; "6 reasons why good businesses fail. And so on".
Is the numbered list a Biblical invention? Probably not. The Old Testament never actually calls them the Ten Commandments and if you count up all the must-dos and no-nos they should add up to somewhere in the region of 613, and that’s not counting the subordinate legislation. But it’s hard to market any product if you start with all the rules and regulations, so convenience rules supreme and the Big Ten, as it were, get the star billing and the rest you discover for yourself later.
The Old Court Room, Lincoln's Inn
So too is the case of the Ten Commandments for IP dispute resolution: they are only really a selection of subjectively chosen headlines. I’m willing to bet that, if I gave every one of you a piece of paper and a pencil and asked you to make your own list of ten, no two people would emerge with the same list. This means that there should be plenty of scope for discussion after I finish – or, knowing the propensity for students and IP practitioners to talk – even before I finish.
Always work backwards from your ideal outcome.
IP dispute resolution is NOT an end in itself; it’s a means to an end. The fact that you have an IP right that someone else is infringing doesn’t mean you have to sue them. Ask where do you want to be in three, five or ten years down the road. Is there any other way of getting there than by suing or instituting ADR?
I learned this lesson when I was doing my PhD back in the mid-1970s and I visited the then head of patents at Unilever. I asked him how it was that, with a portfolio of so many patents and trade marks, Unilever’s name was so rarely among the names of litigants in the reported cases. He explained to me that, despite having a budget that would facilitate any amount of costly litigation, the company started from the point of view of where it wanted to finish. It was very often far cheaper and easier, and also much quicker, to pay infringers to help change their products, brands, business cards and so on than to go to court and get a judgment – and they sometimes earned a little kudos by so doing.
The legislative process was once
a lot more exciting than it is today
Treat all dispute resolution exercises as business decisions.
This means that they have to be costed out and properly budgeted for. The commitment of staff, effort and emotional energy are all finite commodities that might be deployed elsewhere to better effect, or which might need reinforcement. The timing of all outlay and which out of a number of internal budgets the money might have to come from, is also something to look at, particularly if you have accountants who are apt to say things like “you can’t have a High Court action this year because you had one last year”.
Use the law that’s there rather than try to make new law.
It is not unknown for new law to be made by the courts, rather than by the legislative bodies of the United Kingdom and, increasingly, the European Union. This however is not a good reason for going to court. The resolution of disputes in court is driven by a number of factors and one of them is indeed the need to achieve justice in the individual case. This is not however the sole criterion employed by courts in reaching their conclusions: the need for the legal system to be stable and predictable, as well as the fact that trial courts that do make new law are inviting an appeal which may well undo any legal creativity at first instance, should not be ignored.
Every so often there is an overt attempt to change the law, but this tends to be the privilege of the rich. The UK litigation which led to the CJEU ruling in Case C-487/07 L’Oréal SA, Lancôme parfums et beauté & Cie SNC and Laboratoire Garnier & Cie v Bellure NV, Malaika Investments Ltd and Starion International Ltd [on which see Katnote here] might be said to be an example of an attempt to change the law succeeding; the assault on Unilin Beheer BV v Berry Floor NV and others  EWCA Civ 364 in Virgin Atlantic Airway Ltd v Zodiac Seats UK Ltd  UKSC 46 [discussed by the IPKat on more than one occasion] might be another. But by and large it’s best to use the law that’s already there.
Don’t invoke a registered right that you are not prepared to lose.
If you are accusing someone else of infringing your registered IP right, your defendant can do various things. The most tiresome and long-winded approach is likely to be to find some sort of serious defence or justification and then hope frantically that it sounds credible. The lazy man’s response is to say, “let’s find something wrong with the IP right in the first place; if it’s invalid we needn’t even look to our own conduct”. The corollary to this is that, if you are suing someone for infringing your registered IP right, first ask if he can knock it out of the water.
We’ve had two fabulous examples of this in the past few months, in the Sofaworks and Ukulele cases (The Sofa Workshop Ltd v Sofaworks Ltd  EWHC 1773 (IPEC) [on which see Katnote here] and The Ukulele Orchestra of Great Britain v Clausen & Another (t/a the United Kingdom Ukulele Orchestra)  EWHC 1772 (IPEC)) [on which see Katnote here], where actions for trade mark infringement and passing off have resulted in the loss of the claimants' trade marks that were clearly in danger from the outset, while resulting in victory for the claimant in each case on the ground of passing off. This sort of outcome is not new. We saw much the same in the celebrated litigation between United Biscuits and Asda over the latter’s Puffin chocolate biscuit, said to infringe the Penguin trade mark (United Biscuits (U.K.) Ltd v Asda Stores Ltd  R.P.C. 513) here: there again the claimant succeeded in a passing off action but had four of its pictorial Penguin marks revoked. While the accepted wisdom is that it’s quicker, cheaper and generally more effective to sue for trade mark infringement than for passing off, this only works if the trade marks are beyond reproach – and certainly beyond attack.
Patents are vulnerable too, in that the emergence of hitherto-unknown prior art can sink an otherwise buoyant patent below the waterline in the case of a want of novelty or above the waterline in the case of arguable lack of inventive step. The great 1962 publication that was the first IP book I read – Blanco White on Patents for Inventions – made it plain that, at least when he was around, there was no patent around that could withstand a concerted assault on it via the prior art, if you throw enough money at it. So is it better to put your patent on the line and risk losing it, or adopt a more subtle approach such as that which we see in the world of patent trolls, when the would-be plaintiff nominates a sum for use of the allegedly infringing patent that makes it cheaper to pay up than to fight and win?
It’s not just IP law that decides IP conflicts.
Some years ago, no doubt in an unaccustomed moment of rhetoric and hyperbole, Sir Robin Jacob, addressing a gathering of postgraduate law students, said – and I quote: “You don’t need to know any IP law if you want to be successful. You have to know procedure. That’s what wins cases!” It has to be said that there is some merit in that position. Don’t take your eyes of those bits of the law that are not IP-specific: limitation periods, jurisdictional rules, case law governing stays, summary judgment, estoppel, laches and the like. And let’s not forget evidence, especially in proceedings before the Office for Harmonisation in the Internal Market, where the Boards of Appeal are in the process of being buried in an avalanche of detritus masquerading as evidence of genuine use over a specific time-bound: business cards, key fobs, product reviews, family photos and goodness-knows-what else. There ought to be an online museum of useless and futile evidence, to which trade mark owners can refer before deciding to argue that they have proof of genuine use of their marks.
Size up your opponent wisely.
Some opponents are more conciliatory than others, so it’s worth doing a bit of homework on them. It’s surprising how much information a Google search can yield regarding a company you are thinking of suing, or which is suing you. Are you dealing with a vexatious or irrational foe or, worse, someone who goes to court “on principle”? Has your foe a track record for not obeying court orders or for manically reinterpreting them? Does your adversary have any money? Is there likely to be any support from a trade or professional organisation that might encourage an action not to settle, in order to establish a ruling that is favourable for the whole sector?
Some adversaries can
be quite menacing
Go with the odds. They are not the odds for nothing.
Statistics are admittedly a better record of the past, since they describe it, than a predictor of the future. However, predictions do play an important part in our lives and we rely on them extensively in making many of our decisions. If there’s a 90% of it raining for the day at Lords or Wimbledon, many people will still turn up, partly because they are optimistically looking forward to an event of some excitement and importance, and partly because they have already paid for their tickets, and it doesn’t cost them much extra to turn up and hope to be lucky. But if a professional legal advisor tells you that you’ve only got a 10% chance of success at trial your position is rather different. For one thing, you haven’t yet bought your tickets. For another, even if your gamble against the odds pays off and you win, to the extent that the trial judge’s decision is against the odds, that is also the extent to which the other side will be looking carefully for grounds of appeal.
The principle of regression to the mean may also be worth contemplating. This principle, which is also a statement of probabilities, suggests that, where an individual decision deviates from an established norm, the more likely is the next decision to revert to the mean. So don’t count on one against-the-odds decision being replicated – unless it’s a binding decision of an appellate court or any decision of the Court of Justice of the European
LotteryUnion.But if the odds are truly against you, that’s when ADR thought mediation can really come into its own: it can give you a chance to talk your way to a more discreet and occasionally more favourable outcome than going to trial.
Don’t spoil a good case by trying to improve it.
Remember the salutary tale of Utopia Tableware Ltd v BBP Marketing Ltd & The British Bung Manufacturing Company Limited  EWPCC 28 (30 May 2013) [noted by the IPKat here], a case involving infringement of design rights in beer glasses. Two directors who had given witness statements admitted that the evidence they had given was deliberately fabricated to mislead the court in order to advance their company's interests and that they had conspired to present false evidence and to lie in their witness statements. False emails had been created and presented to the court as genuine. The two individuals won their case, without the need to rely on the fabricated evidence, and were sentenced to six and two months imprisonment respectively.
Remember the court of public opinion.
The decisions of the court of public opinion aren’t binding and can’t be enforced in a court of law, but they can nonetheless be worth a great deal.Public opinion is shaped, not to say manipulated, by the mass media and increasingly by the social media, so its force should not be overlooked. I have already mentioned United Biscuits (U.K.) Ltd v Asda Stores Ltd  R.P.C. 513. Let’s mention it again. So far as United Biscuits was concerned, it was fighting to protect market share and goodwill in a hallowed chocolate biscuit product that had nourished generations of British consumers since 1932 [here’s a curious coincidence: Penguin biscuits were launched by a Scotsman, William MacDonald; the Prime Minister in 1932 was Ramsay MacDonald (right). Just think how the course of history might have been changed if the Penguin chocolate biscuit had instead been branded the Big Mac]. The British public was however entertained via the tabloid press by a hilarious scrap between Penguins and Puffins, with a few Pelicans and Pigeons thrown in, and maybe even a Ptarmigan or two, and came out with the knowledge that you could get perfectly serviceable quasi-Penguin chocolate biscuits from Asda for a good deal less than the price of the leading brand. Public opinion was none too sympathetic to Penguin.
A more extreme case of lack of public sympathy caused KFC to drop its action against a North Yorkshire pub, the Tan Hill Inn, in 2007 when, having registered the words FAMILY FEAST as a trade mark, it then sought to enforce it against the pub which was using the words “family feast” on top of its menu. Said the company, "KFC has to protect its trademarks against those who seek to trade off its brand. KFC has spoken to Mrs. Daly at the Tan Hill Inn and confirmed that it will not take this case any further. It’s an unusual situation that has been blown out of all proportion". Indeed.
Fortunately, TIPLO managed
something rather grander than this
The court of public opinion is also an international court. The travails of proprietary pharmaceutical companies seeking to assert their patent rights amidst the HIV-strife of South Africa are a case in point.
Break any of the previous nine commandments if there are logical and advantageous reasons for doing so.
Dispute resolution isn’t like painting by numbers: you have to watch for opportunities, developments and problems that weren’t catered for in your original dispute resolution plan –- and be prepared to act swiftly and decisively when they occur.